The president of Uniqlo, a Japanese clothing retailer, is waiting only for direct instructions from President Donald trump. If Trump would force the company to manufacture its apparel in the United States, Tadashi Yanai, the founder and president of Fast Retailing, the owner of clothing store Uniqlo, said he would rather close its U.S. stores.
Revitalizing American manufacturing
The threat by Trump to collect a tariff on foreign imports is part of his campaign promise to revitalize the manufacturing industry in the U.S. After Toyota Motor announced a plan to construct a new factory in Baja, Mexico, where Corolla cars would be manufactured for the U.S., Trump tweeted that Toyota should build the facility in the U.S.
or pay a hefty border tax.
Yanai, in opposing the planned tariff on foreign imports, pointed out that if manufacturing products in the U.S. is a bad decision for consumers, it is meaningless to conduct business in the country. Other retail executives agreed with Yanai that if the 20 percent of border adjustment tax proposal of Trump would be imposed, prices of consumer goods could further increase, Fortune reported.
Sandy Kennedy, president of the Retail Industry Leaders Association, pointed out that the proposed border adjustment tax “is harmful, untested, and would put American retail jobs at risk and force consumers to pay as much as 20 percent more for family essentials.”
Mexican shift
Trump wants to prevent Mexicas from entering the U.S.
as illegal immigrants because they steal jobs from American workers. Even if he insisted on erecting a 30-foot-high border wall which could stop future illegal immigration, Mexicans remain the favored workers of at least five American companies that relocated their factories from the U.S. to Mexico recently. Caterpillar moved from Joliet, Illinois, to Monterrey, while Illinois Tool Works shifted from Indianapolis to Ciudad Juarez.
Meanwhile, Renord Corp. relocated from Indianapolis to Monterrey. Likewise, TE Connectivity transferred from Pennsauken, New Jersey, to Hermosillo, while Triumph Group moved from Spokane, Washington, to Baja, California and Zacatecas, Mexico.
Alan Russell, CEO of Tecma Group, a Texas company, explained that the threat of Trump to impose a border tax on goods made outside the U.S. would not stop the exodus of companies manufacturing elsewhere that offer lower cost. “This isn’t about taking jobs from the U.S. – it’s about saving companies,” he said.
